The Free Credit Score Loophole

On April 2, a new Federal Trade Commission rule went into effect aimed at helping consumers avoid misleading ads for “free credit reports.”

Many of these seemingly free credit reports turn out to be nothing more than free trials, costing consumers much more than they bargained for when they fail to cancel and get enrolled in credit monitoring programs.

Companies offering such products are now required to put a disclosure at the top of each page that mentions “free credit reports,” with links to AnnualCreditReport.com and FTC.gov.

But much like any other regulation, a loophole has already been discovered and exploited.

Over at FreeCreditReport.com, they’re now charging $1 for a credit report (so it’s no longer free), but giving that dollar to charity.

Don’t be fooled, it’s just a tactic to avoid putting that required disclosure on their website.

They’ve also adjusted their marketing pitch from “free credit report” to “free credit score.”

The folks over at CreditReport.com are pitching the free credit score as well, while effectively avoiding the FTC disclosure.

It’s kind of hilarious and sad, all at the same time.

The FTC rule also requires the credit reporting bureaus to delay advertising for products and services on AnnualCreditReport.com until after consumers get their legitimately free credit reports.

Why they allowed advertising on the government site to begin with is a bit dubious, but the rule may help some consumers avoid being charged unnecessary fees.

Consumers are entitled to a free credit report from each of the three credit bureaus once annually, but the reports don’t include a credit score.

If you want a credit score, you must pay or enroll in a free trial; there’s also the credit score card, which offers a free credit score range for consumers.